SMR Should I Buy
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NuScale Power Corp (SMR) is not a good buy at the moment for a beginner investor with a long-term strategy. The stock faces significant negative catalysts, including a class action lawsuit, declining financial performance, and bearish technical indicators. While there is optimism around its long-term commercialization prospects, the near-term risks outweigh the potential benefits, especially given the investor's preference for a stable long-term investment.
The technical indicators are bearish. The MACD is below 0 and negatively contracting, the RSI is at 37.54 (neutral zone but leaning bearish), and the moving averages show a bearish trend (SMA_200 > SMA_20 > SMA_5). The stock is trading near its key support level of 12.387, with resistance levels at 15.825 and 16.887.
Early design approval from the NRC, which could support future growth.
Strategic partnership to deploy 72 power modules, indicating long-term commercialization potential.
Class action lawsuit for securities fraud, creating legal and reputational risks.
Significant revenue drop (-94.72% YoY) and negative gross margin (-103.70%).
Analysts have lowered price targets significantly, citing near-term headwinds such as Fluor's share sales, ATM-related pressure, and project delays.
Pre-market price drop of -4.73%, reflecting weak investor sentiment.
In Q4 2025, revenue dropped to $1.81 million (-94.72% YoY), net income fell to -$50.83 million (-32.21% YoY), and gross margin declined to -3.37% (-103.70% YoY). EPS improved to -2.17 (+214.49% YoY), but overall financial performance remains weak.
Analyst sentiment is mixed but leaning negative in the near term. Multiple firms have downgraded price targets significantly (e.g., Barclays from $45 to $15, Cantor Fitzgerald from $55 to $20) due to near-term headwinds. However, some analysts remain optimistic about long-term commercialization prospects, with ratings such as 'Buy' or 'Overweight' from Texas Capital and Cantor Fitzgerald.
